The remuneration & human resources committee operates under an approved charter, assisting the Board to fulfil its corporate governance supervision responsibilities and to align the remuneration philosophy with the company’s business strategy. The key focus in this regard is to attract, retain, motivate and reward directors, senior executives and staff by the payment of fair, competitive and appropriately structured remuneration in the best interests of shareholders.

Membership

The committee comprises the group chairman and three independent non-executive directors. RT Vice served as chairman of the committee with RC Andersen, NM Magau and AA Routledge as members. The group chief executive, group financial director, enterprise capability executive and independent advisor attend meetings in an ex officio capacity.

The committee met three times during the year under review.

The committee terms of reference were reviewed and approved by the Board during the year.

Terms of reference

The chairman of the committee reports to the Board on the committee’s deliberations and decisions. The committee assists the Board by regularly submitting reports and recommendations regarding the Murray & Roberts employment framework and policies and the Group’s remuneration philosophy.

The committee is responsible for considering and approving proposals regarding the remuneration, benefits, share options and related matters of executive directors of the Group, including the group chief executive, all managing directors of the Group’s operating entities and senior group executives. It also considers and approves the remuneration and benefits paid to general staff and has responsibility for oversight of the group pension, provident and other benefit plans.

An independent advisor reviews the Group’s remuneration policies and practices.

The functions, role and mandate of the group chief executive are considered by the committee and his performance is assessed. Succession planning to the group chief executive and senior executives is also considered by the committee.

The committee considers the Group’s leadership succession and development strategy and the Group’s employment equity status as described in the sustainability report.

Director and executive remuneration

The remuneration packages of executive directors and senior executives include performance related remuneration, which is determined in terms of incentive schemes operated at group and operating entity level. These schemes are disciplined and are designed and implemented with assistance from the independent remuneration consultant to competitively reward those directors and executives who have contributed to the Group’s sustainable earnings growth and value creation.

Non-executive directors receive a fee for their contribution to the Board and its committees of which they are members. The level of fees for service as directors, additional fees for service on board committees, fees paid to independent advisors and the chairman’s fee are reviewed annually. The committee recommends fee structures, other than for services on this committee, to the Board following research into trends in director remuneration for approval by shareholders at the annual general meeting.

The Group’s remuneration policy is described in the remuneration report on pages 126 to 129. The remuneration of executive directors for the year ended 30 June 2010 is set out in note 46 to the consolidated financial statements. Remuneration details of non-executive directors for the year to 30 June 2010 are set out in note 46 to the consolidated financial statements and the proposed fee increase is included on page 116.

Retirement and other benefit plans

A number of retirement funds operate within the Group. In South Africa these are registered as pension or provident funds and are accordingly governed by the Pension Funds Act. Although some funds are privately administered, the majority of funds are incorporated in outsourced umbrella schemes.

The assets of the funds are independently controlled by boards of trustees which include representatives elected by the members. Further details on retirement and other benefit plans are provided in note 45 to the consolidated financial statements.

Royden Vice
Chairman